Vinit Sambre, Head of Equities at DSP Investment Managers, believes that the market is better equipped to handle COVID if a third wave hits this time around. He also believes that some correction in the Indian equities market will be healthy. He also mentioned that he likes the consumer discretionary space, real estate and autos. He is extremely bullish on banks as well.

He said, “The good part about the virus is that the story has got played last two times and this time around, even if there is a risk of third-wave, probably the economic impact of the virus may not be as much as it was earlier.”

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Market correction looks okay from the long-term perspective because there has been a massive rally over the last 20 months or so. To some extent, this correction takes away some bit of exuberance that had got created.

“If it corrects further, it would make sense to look at few names particularly across few segments,” he said.

He sees long-term visible growth opportunities available across different categories like consumer discretionary.

“It had become a bit more expensive. So the momentum would continue if we take next four-five years’ time horizon into consideration. Hence, stock correction is a good opportunity to look at that particular category,” he stated.

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Housing sector seems to be in a bit of a continuity.

“Businesses linked to the housing plays – the ancillary plays - is where we are looking at incrementally.”

Auto sector is one sector, which is up there in terms of getting disrupted with the talks of electric vehicles (EVs). He expects to see a cyclical recovery in this sector.

“We believe that there is a very good chance of the incumbents coexisting and them also becoming a part of this whole new technology environment. We hope and believe that there is going to be a cyclical recovery there and the stocks are going to be available at decent valuations. Both auto OEMs and auto ancillaries make a good case to be looked at,” he added.

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According to him, once growth and the credit risk is taken care of, banking stocks will make a good case over the long-term.

He has a long-term positive view on the pharmaceutical sector. In the next one or two quarters, the overall outlook for the sector should come back.

“Domestic market still continues to show reasonable growth. I believe once people start visiting hospitals and doctors, normal demand curve will improve. Inventories should normalize and that is how the demand normalization will take place,” he said.

Sambre is overweight on banks. “The growth is gradually picking up. At least for the private sector banks, it has been a decent one. The fundamentals should prevail over the longer-term and things should normalize,” he explained.

For the full interview, watch the accompanying video.

Catch all market updates here.

(Edited by : Dipikka Ghosh)

First Published:Nov 26, 2021 1:49 PM IST